The Man Who Won $50B From Russian President Vladimir Putin -- And Now Has To Collect It

Tim Osborne is an unheralded Brit who lives in the genteel Georgian Cotswold town of Cheltenham, England, and has never run a publicly listed company

Yet in July he joined an exclusive club of people who have taken on Russian president Vladimir Putin and won.

Osborne is executive director of GML, which won an arbitration case it brought in The Hague, The Netherlands, against the Russian Federation under the terms of the 1994 Energy Charter Treaty.

The tribunal that heard the case awarded damages of $50 billion – by far the largest ever award against a nation in arbitration history – representing the value of the assets of Yukos, the oil company that Russia took over and sold off a decade ago.

So does Osborne have any lessons for the West, which is using sanctions in its own tussle against Putin over Russia’s actions in The Ukraine?

“It’s organisational primarily,” he says. “My job is to make sure that we have the right people doing the right things: finding and managing the law firms, accountants and investment advisers that we use. It’s a pretty standard CEO-type role. But I think you need to be diligent and you need to be dogged.

“I think it’s important to just keep the nose to the grindstone and make sure we get this job done effectively. That’s what got us to where we are – not getting sidetracked, not allowing the odd setback to depress you and knowing we would get a win because right was on our side.

“I believe sincerely in the rule of law and was determined we would get the rule of law to prevail on this issue and, with this arbitration decision, it has.”

It has been a lengthy saga for Gibraltar-incorporated GML, a financial holdings company set up in 1997 as Group Menatep by former Yukos chairman Mikhail Khodorkovsky.

GML, which held 60% of Yukos through wholly-owned subsidiaries, started legal action against the Russian Federation in 2005, alleging that its actions in taking over Yukos, once Russia’s largest oil group, and Yuganskneftegaz, its main production asset, amounted to state expropriation.

In a 600-page ruling, the tribunal’s three-person panel adjudged that the seizure and break-up of Yukos was part of a politically-motivated effort against Khodorkovsky, once Russia’s richest man.

The panel stated that Russia was “not driven by motives of tax collection” but “by the desire of the state to acquire Yukos’ most valuable asset”. It said in its judgment: “It was in effect a devious and calculated expropriation.”

Khodokovsky was arrested in 2003 and served ten years in prison on embezzlement and tax fraud charges before being pardoned by Putin late in 2013.

He now lives in Switzerland and has no claim to Yukos assets, having handed his stake in 2005 to his former deputy at Yukos, Israel-based Leonid Nevzlin, who now has a 70% share in GML.

The remainder is owned by four other individuals, plus a veterans trust for about 40,000 retired Yukos employees .

Osborne, whose day job is the senior partner of Wiggin Osborne Fullerlove, an English law firm specialising in international tax issues, acted for Group Menatep on tax planning before joining the company unexpectedly.